• ByteDance is reportedly shopping around for hardware to power the training of an AI model.
• The company will reportedly lean on Huawei for that hardware.
• However, ByteDance has denied that it is both shopping for AI hardware or developing a new model.

By January next year, ByteDance needs to sell TikTok or face a ban in the US. However, there are suggestions that ByteDance will simply exit the market and reports of its artificial intelligence play lend further credence to that thinking.

In an exclusive report citing anonymous sources, Reuters writes that ByteDance may be leaning on Huawei for powerful hardware that’ll help power the training of a new AI model. As ByteDance is a Chinese company, it’s unable to use hardware from AI bigwig Nvidia thanks to bans from both the US and China. As such, the most obvious move is to lean on Chinese manufacturers and that’s where Huawei comes in.

As Reuters notes, ByteDance already uses Huawei’s Ascend 910B chip but it would need something more powerful to train a new AI model according to sources. Nvidia is top of the pops when it comes to AI training hardware and ByteDance would need something comparable to Team Green’s tech. By further incorporating Huawei – which is banned in the US – into its product line it could make it very difficult for a US entity to separate the wheat from the chaff should it buy TikTok.

The company already has AI features, namely Doubao, a chatbot that could be likened to ChatGPT for China. It even has video generation capabilities. Doubao is reportedly very popular with 10 million monthly active users.

It seems then that ByteDance has had a taste of AI and it wants more but it needs more powerful hardware to enable more complex solutions. The company is able to buy some Nvidia hardware but its not really comparable to the components being used in unsanctioned countries.

However, ByteDance spokesperson, Michael Hughes refuted the reports from the sources and told Reuters directly that, “The entire premise here is wrong. No new model is being developed.”

While ByteDance has little choice but to lean on local hardware makers for its AI plays, it may also be strategic. By building its AI on Chinese made hardware, it could be tough for one of its subsidiaries, like TikTok, to break off and have to adapt that tech for new hardware.

It’s not impossible mind you, especially since ByteDance is using some US-based technology, but it could prove more trouble than it’s worth for a future buyer.

ByteDance has until 19th January to decide to sell TikTok or exit the US market. Given that we’ve heard very little about a definite sale, the latter is looking to be a more likely move but anything can happen.